H.R. 10153: American Mariner Tax Fairness Act

This bill would change the federal tax rules for certain U.S. merchant mariners. In plain terms, it would let qualifying mariners treat the wages they earn while working on certain ships in foreign trade as foreign earned income for tax purposes.

What changes in practice

Under current law, some income earned by U.S. citizens or residents working abroad can be excluded or treated differently under the foreign earned income rules. This bill would extend a similar tax treatment to a specific group of merchant mariners who work on qualifying U.S.-flag vessels in international trade.

For the covered workdays, the mariner would be treated as a “qualified individual,” and the income tied to that work would count as foreign earned income, subject to the existing limits and rules in the tax code.

Who would qualify

A person would generally have to meet all of these conditions:

• Be a U.S. citizen or resident.
• Be actively employed on a qualifying vessel for at least 90 full days during any 12-month period.
• Work on a vessel that is:
  • self-propelled, or partly self-propelled and partly not,
  • a U.S.-flag vessel,
  • at least 6,000 deadweight tons, and
  • used exclusively in U.S. foreign trade.

Other details

The bill also makes small technical changes to the tax code so that the new rule fits into existing law. It would take effect for tax years beginning after the bill is enacted.

Relevant Companies

None found